Augusta’s DSM facility will fall under new ownership later this year.
Dutch-based chemical and nutrition company Royal DSM announced a partnership Monday with a global equity firm, CVC Capital Partners, to take a majority stake of a spinoff company that will control its polymer and resin business.
CVC will own 65 percent of the new company, which will make caprolactam, acrylonitrile and composite resins, leaving DSM with a minority 35 percent stake. The new company, tentatively called NewCo, will have nearly 2,000 employees.
DSM said in a statement that the sale of the business units fits with a strategy of reducing its chemical portfolio in order to concentrate on its nutrition business.
The east Augusta facility makes caprolactam, which is used in carpet, electronics and automotive plastic. It has more than 650 employees.
In October, DSM announced plans to spend $85 million to construct a polymer plant next to the caprolactam facility on Columbia Nitrogen Drive, employing 20 people to produce a plastic film used for packaging foods and medical devices.
“We believe the partnership with CVC is the best way forward for these businesses,” said Royal DSM’s CEO, Feike Sijbesma. “This transaction is geared towards value creation for these businesses and is consistent with our commitment to continue to generate value for our stakeholders and deliver on our strategy.”
DSM said in its announcement that it expects to receive $317 million or more in cash from CVC when the deal closes in the third quarter.
CVC started in London in 1981 as a subsidiary of Citigroup. Domestically, CVC is an investor in BJ’s Wholesale Club, Leslie’s pool stores, Pilot Flying J fuel centers and industrial chemical company Univar.
By Tim Rausch